DJ - House Republicans Lay Out Health-Care Plan

By Michelle Hackman

By Michelle Hackman, Kristina Peterson and Stephanie Armour 

WASHINGTON -- House Republican leaders sketched out a plan to repeal the Affordable Care Act, offering a set of policy specifics but showing they have yet to bridge significant GOP divisions over many of its components.

The proposal, whose backers include House Speaker Paul Ryan (R., Wis.), came as President Donald Trump promised to deliver an initial repeal and replacement plan in March.

The plan from House GOP leaders would achieve a central goal of Republicans of overhauling Medicaid in a way that reduces its funding. It would also strike down pillars of the health-care law, such as the requirement that most Americans pay a penalty if they don't have insurance.

The proposal seeks in addition to revamp the individual insurance market where millions of Americans who don't get employer coverage buy insurance. It would replace the health-law subsidies with tax credits Americans could use to help pay for private insurance, and it would allow for skimpier health plans not permitted under the ACA, which some say would help bring down costs.

House GOP leaders billed their proposal as an attempt to address the worries of some centrist Republicans, who are concerned about voting to repeal major portions of the law without a comprehensive replacement in hand, while pleasing more conservative lawmakers who insist on full repeal of the law before moving forward.

With Republican centrists and conservatives divided in the Senate, where the party has only a 52-48 majority, moving health legislation will be difficult. GOP hopes turn on House Republicans rallying around a bill that could force movement in the upper chamber.

The draft proposal drew swift condemnation from consumer groups, who said it would imperil patients and increase the number of uninsured. It also could face opposition from Republicans in the more than a dozen states that expanded Medicaid under ACA.

At a White House meeting Thursday, President Donald Trump was told by House members who supported his presidential bid they were looking for his help on the issue. He told them, "We're going to get it done" with the help of Dr. Tom Price, the new Health and Human Services secretary. A few hours later, at a news conference, Mr. Trump said, "We should be submitting the initial plan in March, early March." He appeared to be referring to the House effort resulting in a bill that could move forward by then.

In removing the insurance requirement, the proposal risks prompting insurers to raise premiums or flee the exchanges -- marketplaces where consumers can buy insurance -- that the administration has recently tried to sustain into 2018. That is a scenario that centrist Republicans in the Senate have said they want to avoid.

Republicans haven't determined how to pay for new tax credits, whose price tag is unclear. Savings from Medicaid likely would account for part of the cost. The proposal would let states that expanded Medicaid under the ACA keep their programs but would significantly cut federal funding for them.

GOP leaders hope to include several elements that would help construct a new health-care system. Their plan would increase the amount of money that people could put into health savings accounts, and it would offer age-based monthly tax credits to people buying health insurance on the individual market. People who don't get insurance through their employers would receive refundable credits to buy benefit plans that could be less comprehensive than currently permitted under the law.

States would also receive grants they could use to set up to help cover people with more expensive consumers with pre-existing conditions.

The tax credits at the heart of the proposal have in particular exposed divisions in GOP ranks.

Rep. Mark Walker (R., N.C.), chairman of a group of House conservatives called the Republican Study Committee, said some in the group have traditionally preferred tax deductions to tax credits, and are not yet sold on the emerging plan. Tax deductions lower taxable income and are more valuable to people in higher tax brackets. A tax credit reduces the amount of taxes owed.

Mr. Walker said he was concerned that middle-class taxpayers would end up shouldering the cost of the tax credit.

But Rep. Tom Cole (R., Okla.) said it was a "no-brainer" to provide a refundable tax credit. "There are a lot of people who wouldn't have the income to be taken care of [by the deduction], particularly at the lower end of the economic spectrum," Mr. Cole said.

For weeks, GOP lawmakers in both chambers have struggled over how to handle the Medicaid overhaul, which they want in order to curb spending and give more control over the program to states.

Several GOP aides say leaders are leaning toward a system in which states could choose between direct block grants and caps based on the number of people participating in the program. The intent is to avoid penalizing states that expanded the Medicaid program with funding provided by the ACA while treating all states equally.

--Louise Radnofsky contributed to this article.